Wednesday, 31 October 2012

Flashback . . .

I had a terrible morning. I managed to drop my Cannondale right on it's rear derailleur which resulted in a bent hanger. I tell everyone that you need to have a great relationship with you favorite bike shop because at times like these you're going to want to deal someone who is motivated and skillful. I'm lucky as the guys at Atelier De Velo looked after me again. Damn they're good. I was lucky as the hanger was only slightly bent and the guys managed to get it back into shape without hurting the frame. Look don't try this at home or with a tech that you've only just met because this could cost you thousands in a replacement frame. Thanks guys.

I ordered a back-up rear derailleur hanger (AUD 45) in case this ever happens again. I advise that you accumulate useful spares like these when you see them, rather than when you need them. I like to keep in stock spare chains, brake pads, cabling, tires, tubes and even bar tape. I even like to keep spare cleats, heel pads and other clothing and foot ware replacement parts around just in case. I hate having to forgo a ride because of a 10 dollar part. So, unless you live near a European style mega shop like Cicli Mattio near Alba in Italy it's unlikely that even the most organised well stocked LBS will have everything you need in stock. Plan for problems and know how to fix them unless you have some reliable back-up.

Now that's what I call a proper back-up car!

I don't want to re-hash the UBS piece I wrote the other day but I'm starting to feel very uneasy about the depth of these cuts and so too are the Swiss themselves. I follow a twitter account called Swissinfo.ch. It seems that the locals are not happy about being included in the shake-up. The unions are now playing the quality card as they realise that it's not just London or New York that's going to be hit by a wave of redundancies:

“If UBS reduces IT services in Switzerland too much, or moves them abroad, then risk to the bank would increase and specific, vital know-how would be lost,” the association’s secretary-general Denise Chervet told swissinfo.ch.“[We] call for a more sustainable and long-term human resources policy, not just from UBS, but all banks,” the statement read, adding that UBS owed a debt to the Swiss nation after it was bailed out during the financial crisis.

There it is folks . . reality bites. CEO Sergio Ermotti management bloodlines come from Citigroup, ML and finally UniCredit of Italy. I'm happy to bet that this man cuts too fast and too deep because that's the M.O. of those institutions. I mean ML is or was famous for cutting heads only to rehire at a later date. They're also famous for being absolutely appalling institutions when it comes to the method of making people redundant. I distinctly recall my former boss at UBS in London telling me:

"We don't do things like the Americans, they'll be no black garbage bags waiting in foyers for people who get axed. I don't want people escorted out by security guards in front of their friends and colleagues . . . lets have some dignity out there."

With that I did my first ever round of redundancies shortly after Y2K. That thinking is long gone as Ermotti arranged something a little less dignified for his London staff this week:

"Some 100 of the Swiss lender’s fixed income traders in London discovered at the turnstiles that their passes were no longer working when they tried to get to work on Tuesday morning. Other bankers had been contacted by phone or discovered that they might lose their jobs when their email repeatedly bounced back."

Nice guys. You know what goes around comes around, if you humiliate people they'll bite back. Awful!

China, the land of the cash and carry economy is not so anymore. Q3 accounts receivable have been rising at an alarming rate. The FT says that accounts receivable at Sany Heavy, the Caterpillar (CAT) of China were up 83 per cent year to date at the end of the third quarter, hitting Rmb21bn. At Baosteel and Jiangxi Copper, the biggest listed producers of steel and copper, unpaid bills rose 52 per cent and 66 per cent, respectively, since the beginning of the year. HSBC economist Fred Neumann, who I've had a number of meetings with over the years reckons this is a lagging indicator. Perhaps he's right, but this blogger remains skeptical of the China bottoms argument. We shall see.